14.. Fly Adventures issues bonds due in 10 years with a stated interest rate of 6% and a face value of $500,000. Interest payments are made semi-annually. The market rate for this type of bond is 5%. What is the issue price of the bonds? A. $537,194. B. $464,469. C. $538,973. D. $500,000. PV 1 2.5% 20pds .61027 PVA 2.5% 20pds 15.56816 PV 1 3% 10pds .74409 PV A 3% 20pds 14.87747

14.. Fly Adventures issues bonds due in 10 years with a stated interest rate of 6% and a face value of $500,000. Interest payments are made semi-annually. The market rate for this type of bond is 5%. What is the issue price of the bonds? A. $537,194. B. $464,469. C. $538,973. D. $500,000. PV 1 2.5% 20pds .61027 PVA 2.5% 20pds 15.56816 PV 1 3% 10pds .74409 PV A 3% 20pds 14.87747

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter13: Long-term Liabilities

Section: Chapter Questions

Problem 6MC: On July 1, a company sells 8-year $250,000 bonds with a stated interest rate of 6%. If interest...

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Issue Price The following terms relate to independent bond issues: 500 bonds; $1,000 face value; 8% stated rate; 5 years; annual interest payments 500 bonds; $1,000 face value; 8% stated rate; 5 years; semiannual interest payments 800 bonds; $1,000 face value; 8% stated rate; 10 years; semiannual interest payments 2,000 bonds; $500 face value; 12% stated rate; 15 years; semiannual interest payments Required Assuming the market rate of interest is 10%, calculate the selling price for each bond issue.
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On July 1, a company sells 8-year $250,000 bonds with a stated interest rate of 6%. If interest payments are paid annually, each interest payment will be ________. A. $120,000 B. $60,000 C. $7,500 D. $15,000
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.14.. Fly Adventures issues bonds due in 10 years with a stated interest rate of 6% and a face value of $500,000. Interest payments are made semi-annually. The market rate for this type of bond is 5%. What is the issue price of the bonds? A. $537,194. B. $464,469. C. $538,973. D. $500,000. PV 1 2.5% 20pds .61027 PV 13% 10pds .74409 PVA 2.5% 20pds 15.56816 PVA 3% 20pds 14.87747
A Interest payments per year 13 14 15 a) 16 17 18 19 20 21 22 23 24 25 26 b) B Annual Market Rate Semiannual Interest Payment: PV of Face Amount: PV of Interest Payments: + = Bond Selling Price: $500,000 15 7% 2 1 2 On January 1, Ruiz Company issued bonds as follows: 3 4 Face Amount: 5 Number of Years: 6 Stated Interest Rate: 7 8 9 Required: 10 1) Calculate the bond selling price given the two market interest rates below. 11 Use formulas that reference data from this worksheet and from the appropriate future or present value tables (found by clicking the tabs at the bottom of 12 this worksheet). Note: Rounding is not required. Annual Market Rate Semiannual Interest Payment: PV of Face Amount: + PV of Interest Payments: = Bond Selling Price: C 29 The bond in (a) sold at a: 30 The bond in (b) sold at a: 31 32 3. Use the Excel PV function to verify the selling prices of the bonds. 33 a) Annual Market Rate 34 Bond Selling Price 35 36 b) 37 Annual Market Rate Bond Selling Price 27 2. Use…
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